Give your customer a comprehensive solution and not just a product Part II

This is the second part of my earlier blog post on Customer Satisfaction. You can read the first blog post here.

It was 1999 and I had just ventured in to the Real Estate business then. Although I have come across many incidents and have learnt many lessons during my entrepreneurial journey, I can never forget my experience with my first real estate customer! I met my first customer, one Mr. Manhar Bhansali, through word of mouth. He was a big diamond trader and had come to Pune on a business trip from Mumbai and had heard about our project through his sources. On arriving in Pune he called me to request for a project site visit.

I still remember that feeling of excitement and thrill on having a potential client call you up and ask to see a property! Delighted, I agreed to take him on a tour of the sample house the same day.  I have always believed in the product speaking for itself, and hence had gone out-of-the-way to show the sample bungalow not just as a view of bricks and mortar but to make it an experience of luxurious living for our potential clients to consider.

Our sample house was a fully furnished bungalow complete with the latest gadgets and technology available in India in 1999. Apart from tastefully furnishing the house, I made sure there was Air-conditioning, washing machines, TV, crockery and cutlery, servants, cooks and even a doctor on call! I had made it a habit of posing myself as a customer to critique my product and services and set a benchmark. This habit had time and again proved its merit as it allowed me to arrive at insights which helped me to give my product an edge.

Due to this practice, I knew that a customer arriving from Mumbai would hate to open the house himself and then get it cleaned; or figure out if there was running water and that his fridge was stocked or whether the cook is available to prepare a fresh food for him or his family. I didn’t position these bungalows as a holiday home, instead I focused on making it feel like a second home where the customer could walk in anytime of the day or night and live there like he did in his normal circumstances. I wanted the transition from his first home to his second home to be smooth and perhaps even a better experience, something that he could even flaunt to his friends.

Our housekeeping team back then was headed by one of the most efficient couples I have met-a retired Colonel from the Indian Army and his wife who had worked with the Marriott Chain as the head of their housekeeping. She worked hard at training the local help and transformed them into proud, honest and hardworking helpers.

We even had an instance where a customer had left his watch worth Rs. 1 million, and it was found and returned to him by the staff. When the delighted customer tried to give him a gift for his honesty, he was suitably enraged. He said “Honesty cannot be bought, Sir. You can keep your money!” I have always believed that organizations are only as good as their lowest common denominator. If your helper has values and has been trained and takes pride in his job, you can rest assured that half your job is complete.

Getting back to Mr. Bhansali, he liked what he saw and he immediately asked me to get the papers ready and meet him at his office in Bombay. Since I had those papers ready in advance, I left for Bombay the next morning and met his lawyer and handed over the No Objection Certificate (NOC). And as promptly I had responded, Mr. Bhansali too was quick in closing the deal and handed over my first cheque of Rs 50 Lakhs, as an advance for purchase of the land, in the same afternoon.

Ecstatic and on cloud nine on making my first and a quick sale, I spent the next 48 hours in the happy high of my success. Two days later, I got a worried call from Mr. Bhansali in the late hours of the night. He was anxious and worried about his investment as he had burnt his fingers in the past with rogue builders who had swindled him out of his money.

As he narrated the above experience, I could see the money slipping out of my hands! I made a quick decision, and an emotional one at that, and decided to return his money. I told him I didn’t want my customer losing sleep over a deal and that I’d rather have his friendship and trust. Even though my voice was calm and confident while I said this, to be honest I was scared to death! Just the thought of giving that money back gave me heart palpitations and I could hear a little voice inside my head calling me foolish! But my big risk had paid off. On sensing my honesty and commitment, Mr. Bhansali immediately refused to take the money back. My risk had won me a client and a friend!

Mr. Bhansali had booked the deal in November of 1999 and he wanted the delivery of his 6,000 sq. ft. villa with all comforts and the décor he saw in our sample bungalow in 5 months! Even though I was committed in winning over his trust, I was still a realist and informed him that there was no way we could build it that fast! I didn’t want to make a promise that I couldn’t keep. After a lot of persuasion he reluctantly agreed to postpone delivery date for 9 months. The same day I met my engineering team and persuaded them that we had to do our best to get his house ready in 5 months!

Four months into the construction, he paid us a surprise site visit and informed me that his daughter was arriving from the US in a month’s time. She would not be returning to India for another two years, so he was very keen to get the house-warming ceremony while she was in India. He wanted to have just one room readied for ceremony. Pressed as I was with the existing delivery schedule, I told him that it was not possible. Instead, I could build him a temporary shed and that he could conduct the ceremony there. Sad but resigned to the fact that I was putting in more than my hundred percent he left feeling satisfied.

Mr Bhansali had scheduled the house-warming ceremony a month later at seven in the evening. I promised that I would take care of all the arrangements for the ceremony from my end, thus saving him the trouble. I had instructed my staff to switch off the lights in the house as soon as they see his car entering the project’s gate. I was standing at the entrance waiting to give him his surprise. As he stepped out of his car, all the lights were switched on all at once, inside and outside. I can still picture the look on his face when he saw his house decked and lit up. I had made sure everything was in place, right from his living room to his bedroom! I had the crockery and the cutlery laid out on the dining table, had made sure there were flowers in each bedroom and toiletries in each bathroom.

Sweet Success.

My first customer entered his house to the music of Bhimsen Joshi singing Raag Basanti in the drawing room and with eyes wide with wonder! Till this date I relish the sight of wonder, delight and appreciation on Mr. Bhansali and his family member’s faces! As soon as they had finished exploring their house, I called the Panditji and left them to perform their house-warming Pooja.

Even though I had said no, I had pushed my limit to provide my customer with a solution to his problem and not just a product! I had of course under promised and over delivered but let me warn you, friends that it’s a very fine balance to maintain! The toughest word to say is NO to a customer, but sometimes it’s the right word to say! In order to satisfy my customer I had pushed myself and my entire team to the brink. I never repeated this exercise again and reserved it only for my first customer!

Parag Shah

September 2012.

Give your customer a comprehensive solution not just a product!

 

In 1988, I was appointed the distributor for Photophone India Ltd., the manufacturers of Hot Shot- the first cameras that were introduced in the 35mm and 110mm format. These were supposed to be a replacement to the Click III from Agfa which were old and archaic.

Image courtesy Digicam History

I was expected to distribute their Konica color films, photographic paper, chemicals and equipment in the eastern India Markets. I was asked to handle the states of West Bengal, Bihar, Orissa and Assam and all the North Eastern States of India. Yet the brand that I was supposed to promote, Konica, had little or no market share in the Eastern India Markets. Apart from that, I had never even been to Calcutta, let alone have an understanding of that market! I was both ecstatic and afraid at the thought of chartering a new territory! Folding my entrepreneurial spirit on my selves, I told myself challenge accepted and went straight ahead with the distributorship.

Back then in the erstwhile Calcutta, the photofinishing market was controlled by the Sanghvi family under the brand name Snap Fotos. Today the famous Sun Pharma belongs to the same family. The only other brand that controlled the market belonged to the Roy Choudhury family. The market there was otherwise highly localized in areas where the labs were. We called these labs “stand alone” as they were unlike the “chains” mentioned above. During those times, the two main competing brands in the photofinishing businesses were Konica and Fuji.  Although priced the same, Fuji was clearly the market leader.

Market Contenders

Beating a market leader in a market that you have very little knowledge of is a feat in itself, so instead of getting intimidated by the task at hand, I decided to use strategies that had worked well for me in the past. To break through the market, I didn’t try to break into large consumer markets in my first go. Instead, I focused on the smaller ones who were largely ignored by the major players. I also worked at becoming their solution provider and not just their product distributor.

To execute the above strategy, I created a service I called “The Konica All Clear Service”. I requested Photophone to provide me with a Ph. meter and a Densitometer, complex electronic equipments that required some training and skill to read. The Ph. meter checked the Ph. of every chemical used in the process of photofinishing, while the Densitometer checked the final results and ensured that the color balance of Red, Green and Blue  was perfectly matched, thus giving you a bright, consistent and superior quality of prints.

Now every chef knows that the proof of the pudding is in eating it, so in order to get my pitch perfect for the stand alone lab owner, I got a set of prints printed by either Snap Fotos or at Roy Chauhdhari’s “chain” of labs, depending on the area where my “stand alone” lab customer was located. Armed with this set of negatives and prints, I went to the “Stand alone Lab” and requested them to print the negatives, like any other normal customer did and paid them for these prints.

Stand alone labs

Once I had their product, I would then take out what I had previously printed at the “chain” and compared the two right in front of the owner. Quite naturally, the lab owner would get defensive about his quality and service. It was precisely at this point that I would ask him if he wanted his prints to look as good as or even better than the one I was comparing his work with. With a look of sudden surprise on their faces and a bit of suspicion in their eyes, they would cautiously say yes just out of curiosity to see what magic I could do.

I would then roll my sleeves up, and ask to be taken to their processing room. Once there, surrounded by the owner and his staff, I would then open my bag and take out my instruments one by one and display it on the table. Using these instruments I would then take my time and check the Ph. of their chemicals and  proceed to give them my diagnosis. I would always go one step ahead and make the necessary corrections in their chemicals and print the same set of negatives right then.   Lo and behold! The prints would turn out better or at least as good as the competitor “chain”.  What the stand -alone lab customer didn’t understand was that quality is 99% based on the conditions of the chemicals used in your photofinishing equipment!

After every one of these sessions, I would always be invited to the back office for a cup of hot chai and snacks! Most of these lab owners had become my friends as I had given their businesses a lease of new life! I would send my engineer every 15 days to check their chemical parameters and make corrections by adding additives, if necessary. We would then issue an “All Clear Certificate” from Konica Corp. (Japan) to the lab owner, provided he met our more exacting quality standards, and of course bought our chemicals, photographic paper, and films.

Getting the Konica machine installed at the lab.

Selling Konica Photographic Paper and Films, Machines, and Chemicals was a natural extension of our “All Clear service”. It was something that we found that needed hardly any “selling” once we had explained the advantages of maintaining the chemicals and giving their customers consistency in quality. I considered all of the above as the foundation for all my future sales strategies and didn’t charge the owners anything for the services we provided. This was a win-win situation for both parties since it also saved them huge capital investment in the purchase of the diagnostic equipment, the Ph. Meter and the Densitometer and it ensured that they were maintained on my customer list.

By the end of the year, I even persuaded Konica to make their prices at least 1% higher than Fuji, thus positioning it as a superior product based on price. The big “chains” soon followed automatically. Just under a year, the perception had changed as most customers had begun to perceive Konica as a better product. I say perceive because this is the magic of a cleverly designed and executed sales strategy. There was no difference between Konica and Fuji; in fact it was simple case of applying better quality control!

By giving my customer a comprehensive end to end solution and not just a product, I had won over customers for life. I treated them fairly and with respect. In the span of one year, I had managed to raise Konica’s market share from 2% to 24%, an unparalleled feat in the history of Konica, India. We had challenged the Goliath and had managed to slip the carpet from under their feet!

Converting from Fuji to Konica with the All Clear Service.

For all the startups out there, this is the lesson I wanted to share with you too. You have to  provide your customers a solution, not just  a product! By providing my customer a comprehensive service free of cost; ensuring that the quality of his end product was as good as it should be; by saving him huge Capital investments otherwise impossible for him to make; I had offered him a comprehensive solution. Buying my products became a natural extension to the service I provided. Konica began to replicate that model all over India and soon became market leaders in India.

No matter what business you are in, this lesson can be applied to your business. You just have to be genuine and creative enough to execute it!

To be continued…

Parag Shah

September 2012.

 

How to build bad-weather friends for your business!

Treat your supplier as you would treat your customer.

Sometimes, it’s amazing to see how small little uncalculated gestures towards people who you work with can actually become your business’s lifeline somewhere in the future!

One of the best lessons that I learnt very early on during my snap photos days was to always, always treat your suppliers with respect. I had learnt that if you treated your suppliers with respect, they will go out of their way to help you, when times are bad for you. In business only they can be your best bad weather friends! Let me narrate an anecdote to drive my point.

I don’t understand why most purchase department managers think that their suppliers have to wait long hours, be treated shabbily and should always be put to a fight with another supplier to get the better of them. Having been at the receiving end of such treatment when I was running around for my loan, one thing I was dead certain of was to never treat another human being like that ever again!

I was once travelling by car to Mumbai, in my second-hand  Maruti 800 that I had bought from someone who had worked with me for a several years.  It was a family trip for a relative’s marriage. Back then the old Bombay-Poona highway was a nightmare to drive upon and would take anything from 5 to 8 hours to commute between two cities that were barely  159 km from each other.

We had our customary halt at Khandala for the famous Sangam Batata wadas and as we were coming out, I saw a gentleman standing near the parking. Upon closer look I recognized him as I had met him a couple of times. He used to work with Agfa Germany India Ltd in their sales department. He looked pretty stressed out so I went up to him and asked him what was wrong? He pointed towards his bus which had a breakdown.

Although he didn’t tell me why he was stressed, I felt sorry for him and decided to ferry him to Bombay and informed my wife and children that he was joining us. Now, it was one of those trips where the family was going together after many days, and hence the children and my wife took this as an intrusion, but had no courage to argue with me. Judging the intrusion by their crestfallen faces, Jayant offered that he would manage on his own. In any case there wasn’t enough space to accommodate passenger number 5. But as usual I would have none of it and convinced him to join us.

The trip to Mumbai thereon was obviously a long stone cold silent one.  Just as Jayant was getting down from the car, he said “Thanks Parag. I will be ever grateful to you for this help.” He mentioned that this meant a lot to him since his son was unwell and that it was crucial that he reach home as soon as possible. We dropped him near his house and proceeded for our wedding. And for a long time I had forgotten about this episode until many years later.

Jayant would often visit Pune and we did go on to do business together for many years. He said he loved “Puneri” food and I would often take him out for a customary meal of “Puneri” food on Laxmi Road. He always appreciated the fact that I treated him with respect. I would never ask him questions about how my competitors were doing, what price they got their raw material, who was doing what expansion. Most suppliers are privy to very sensitive competitor information. But I realised that I would be putting him in an ethical dilemma if I did ask him. But whatever, information he would give during the course of a casual conversation, I would listen to intently but not respond to it. Besides, as a matter of principle I never ever criticised competition.

About 3 years later after the incident, the Indian economy went into a major financial crisis. Photographic paper for which India dependent on imports was not available anymore and you could only get to import the photographic paper if you deposited 250% of the value of the goods and that to 3 months in advance! There was no way anyone of us in the business at the time could raise that kind of capital overnight. Moreover that would be 750% more than the usual requirement.

Those days were equivalent to the Wall street collapse. As the months progressed most of my competitors had to shut shop. I too was on my wit’s end and that’s when I one day called up Jayant and said, “I am running out of stock. Can you help?” “Parag, there isn’t anything anyone can do for you. The whole Economy is in shambles and not much hope left.” He ended the conversation by saying he will try to do something for me.

Seven days later, I got a call from Jayant saying that their principals from Germany are here, and he has arranged a meeting for me with the Director of Bayer Germany. He suggested that I could request them to trust me and ask for credit for the purchase of photographic paper. And so I left for Mumbai the same day.

Before my meeting with Director, Jayant had done the groundwork and had pitched me as one of the most loyal and honest customers of Agfa Germany. He knew that the German’s appreciate honesty and loyalty as against volumes. I was a small player at that time and did not contribute much to their total sales. Agfa was a large conglomerate, but Jayant made sure that I got 15 minutes with the Director. I used all my persuasive powers and persuaded him to give me credit for the imports. He said, he would give me 180 day credit. The man liked me! So here was this little guy in Pune who was the only one who had access to imported paper. I was expecting, that business would double owing to the fact that many labs would close down. I placed my order for the 1^st month and had my stock and my lab was up and running!

Jayant the supplier, who was not treated well by other competitors, went out of his way to make sure that my business survived. Why?Probably because I helped him when he needed it and I have always respected him even as a supplier.

The lesson for me was to know that all human beings are equal, and they all deserve our help and respect. Don’t ever do it with an expectation of anything in return. And treat all your suppliers with warmth and respect. My wife would go to market yard every week to buy her vegetables from the largest vendor. I would fret over the fact that she was trying to save a few bucks! I soon realized that she looked at it as a great social event!

She would go to this particular vendor who is the largest wholesale supplier of vegetables in the market.  That man ignored her for months. But she persisted. She slowly got him on her side. She seized the opportunity when he said he wasn’t  getting an appointment with a leading heart specialist in Pune. She drove him to the heart specialist in her car. Got all is investigations done. Helped him with his surgery and made sure the family was at comfort. The old man today sends us his best vegetables every morning, at a real low cost, and picks and chooses the vegetables my family will have .

The next time I am going to talk on trust your employees.

Back them , when they need it most!

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• Dr Jayant Patel spends first free night (bigpondnews.com)

How did I end up becoming an Entrepreneur?

I grew up in a small town near Pune called Daund. My father was the only Doctor of the town and had become a larger than life figure in the town because of his philanthropy. As a child I was extremely shy with low self-worth and had great fear of authority. I was a loner and hardly had any friends I could connect with.

I had one hobby that occupied all my waking hours as a child-reading fairy tales. I loved those vividly coloured books and would get lost in the world of justly Kings and beautiful Princesses and the poor boy who would in the end win the hand of a beautiful princess. It was always the victory of good over evil.

I had a world of my own, which I could create and change and modify, and make it colorful, make it smell beautifully, and imagine the princess as the most ethereal creature on earth. This is where my journey in entrepreneurship began-as a dreamer. To dream is so beautiful and limitless.

I do think all entrepreneurs have the power to dream and have vivid pictures of what they dream about. How many of you out there who have started their own ventures have started out like me? Or was it the opportunity that propelled you?

Do share.